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2017 (2) TMI 112 - AT - Income TaxDisallowance u/s.14A - Held that:- It is not in dispute that the assessee earned the Long Term Capital Gain on mutual fund of ₹ 1,11,23,750 and other income from mutual funds of ₹ 31,55,355/-. It is long term investment and the income was directly credited to the assessee’s account by way of bank transfer. Nothing was seen to be incurred to earn the said income from mutual funds. In view of the above mentioned law i.e. Canara Bank Vs. ACIT (2014 (1) TMI 1586 - KARNATAKA HIGH COURT), the said income is not liable to be considered for the purpose to assess the expenditure incurred to earn the exempt income. Accordingly, we set aside the order of CIT(A) in question and direct the Assessing Officer to re-assess the expenditure incurred to earn the exempt income in view of the above mentioned law by giving an opportunity of being heard to the assessee. Accordingly, this issue is decided in favour of the assessee against the revenue for the statistical purpose. Confirmation of the expenditure incurred upon lease hold improvements - Held that:- The expenditure incurred on lease hold premises has been treated by the above said authorities as revenue expenditure, therefore, in view of the said circumstances we are of the view that the finding of the CIT(A) on this issue is wrong against law and facts, therefore is not liable to be sustainable in the eyes of law hence we set aside the finding of the CIT(A) on this issue and direct the Assessing Officer to consider the expenditure as revenue in nature. Accordingly, this issue is decided in favour of the assessee against the revenue.
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